Frequently Asked Questions

“Success is where preparation and opportunity meet.”
— Bobby Unser

Frequently Asked Questions


What services do you offer?

  • Trust Administration
  • Investment Management
  • Tax Preparation
  • Financial Planning

What type of accounts can you manage?

  • Individual Account
  • Business / Company Account
  • IRA (Traditional / Rollover / Roth / Inherited / Beneficiary)
  • Trust (Revocable / Irrevocable)
  • Charitable Remainder Trust
  • Charitable Lead Trust
  • Dynasty Trust
  • Gift Annuities
  • Escrow
  • 401(k)
  • Agent for Trustee
  • ESOP (Employee Stock Ownership Plan)
  • Conservatorship
  • Power of Attorney

How do your services work?

You can choose among our four core services and mix and match them to your needs. The more services you choose to have with us, we believe, the simpler your financial life will be.

What is your pricing?

Each service is individually priced.

  • Trust Administration: Priced as a percentage of assets under management (Investment Management is included).
  • Investment Management: Priced as a percentage of assets under management.
  • Tax Preparation: Based on yearly fee or standard hourly rate unless combined.
  • Financial Planning: Based on yearly fee or standard hourly rate unless combined.

Why do I want to consolidate my finances with Allen Trust Company?

Our four core services go hand in hand because our systems and team members work together to identify opportunities for our clients. The more services you have with us, the more information we can draw from when making decisions regarding your assets. If you have named us successor trustee, having us manage your investments allows us to develop a deeper relationship with you, and the knowledge we gain can aid us in transferring your assets to your beneficiaries. Preparing your tax return gives us further insight into your finances, enabling us to identify tax-advantaged investment opportunities and to make more accurate predictions when helping you plan your financial future. Combine these services and let us help you answer those big questions: Can I afford my dream house? When do I retire? What will my legacy be?


TRUST administration

What is a trust?

A trust is a legal agreement between two parties: the person who creates the trust (the trustor) and the person, institution or independent trust company responsible for administering the trust (the trustee).

Who needs a trust?

Not everyone needs a trust, but most people should consider one. Trusts aren’t just for the affluent. Setting up a trust is an excellent way to control what happens to your estate, regardless of its size, to possibly reduce estate taxes and protect against the expense and aggravation of probate. Unlike wills, trusts are not subject to probate and therefore allow you to keep your affairs private.

Will or trust? Which is best?

Most people need both. A big advantage of a trust is that it is generally the best strategy to avoid probate and protect financial privacy. Wills must be validated by probate court, a lengthy and expensive process that can take six months to two years and, in some cases, even longer. Probating a will may involve attorney’s fees, executor’s commissions, administrative and other court costs. Unlike wills, trusts are not subject to probate and therefore enable you to keep your affairs private and minimize settlement costs and estate taxes.

Why set up a trust?

There are many reasons to set up trusts. Married couples often realign the ownership of their assets to save substantial federal estate taxes and pass more on to their heirs. Rather than owning assets jointly, they choose to own assets individually so that they can each take full advantage of the increasing unified credit amount. Preserving each spouse’s unified credit can save hundreds of thousands of dollars in estate taxes. If the time comes that you are no longer able to handle your own affairs, trusts can ensure that there will be someone who is experienced and objective to “mind the store.” If there is a serious illness or disability, a trust ensures that a plan is in place to take care of your needs and those of your loved ones. When the trust is managed by a full-service trust company, other professional services can be provided, such as bill paying. Business owners can use trusts to save on estate taxes when passing along businesses to heirs. Trusts are also useful for blended families with spouses or children from previous marriages. The trust can spell out exactly how marriage affects the inheritance of children or grandchildren from a first marriage. Naming an independent trust company removes the emotional element often associated with friends or family members.

Who prepares a trust document?

Usually attorneys draft trusts.

What about fees?

Generally, fees for trust services are spelled out in the trust document. Under normal circumstances, they are calculated annually, based on the level of responsibility assumed by the trustee and the value of the assets in the trust. Fees are charged quarterly or monthly and a portion may be tax-deductible.

How are trust assets invested?

Ultimately, it is the purpose of the trust that determines how the assets are invested, and it is the responsibility of the trustee to see that the purpose is carried out. Often, the person who creates the trust will name a professional investment manager to work with the trustee and make investment recommendations based on the goals of the trust, the needs of the beneficiaries and the time horizon.

Is a trust right for you?

Even people of moderate means may be subject to estate taxes, which could be significantly higher than income taxes. But saving on taxes isn’t the only reason for trusts. Some families want to plan for long-term care or education for their children or grandchildren. Others want to provide for a favorite charity. One thing is certain: if a trust is needed, the time to plan for it is now.

How do you choose a trustee?

Many people prefer to name an independent trust company to handle their affairs. Trustees who do not deal with trusts on a regular basis can be overwhelmed by the duties required of them. Also, naming an independent trust company removes the emotional element often associated with friends or family members and assures that your wishes are fulfilled exactly as they are spelled out in the trust.

Why choose Allen Trust Company?

There are several advantages to naming Allen Trust Company as trustee. Unlike other providers of trust services, our local skilled professionals deal exclusively with trust issues.

Reasons to Distribute Assets to a Trust vs. Distributing them Outright?

Some features of Trusts:

  • Credit Protection using a spendthrift clause. One of the most effective tools for protecting, preserving, and passing on wealth to heirs is the spendthrift trust. It's a unique tool for keeping a family's money safe from not only creditors but also from the heirs themselves. A spendthrift trust is a trust account overseen by a trustee, such as an individual or corporate trustee, that controls the assets you leave. The beneficiary is forbidden from spending the money before they actually receive distributions, and the trustee has the authority to determine what payments are necessary according to the trust agreement.
  • Divorce Protection by keeping assets separate from spouse
  • Asset Protection in certain circumstances

What Types of Accounts are offered?

  • IRA (Rollover / Inherited)
  • Revocable Trust
  • Irrevocable Trust
  • Charitable Remainder Trust
  • Charitable Lead Trust
  • Gift Annuities
  • Escrow
  • Agent for Trustee
  • Conservatorship
  • Power of Attorney
  • Other Accounts

What Trust Services do you Offer?

  • Bill Paying
  • Asset Management for real estate and marketable securities
  • Required Minimum Distributions (RMDs) from your IRA
  • Tax Preparation
  • Financial Planning
  • Retirement Planning
  • Asset Location - Where to locate assets in what type of account
  • Real Estate Consulting
  • Investment Policy Statement
  • Estate Settlement
  • Year-end Asset Tax Harvesting

Investment Management

What is your investment philosophy?

Allen Trust Company’s investment philosophy encompasses our fiduciary standard to build portfolios that reflect the financial goals and risk tolerances of each client. We construct portfolios around a core of individual securities. Investing in individual stocks and bonds better enables us to target specific risk levels, cash flow profiles, and rates of turnover. In addition, it removes a layer of fees and thus enables a more cost-efficient implementation.

Do you get commissions?

We do not receive any trade “commissions” or 12b-1 fees. We charge a straight percentage-of-assets fee. Our interests are aligned with our clients’.

Describe your portfolio construction process.

Since inception, Allen Trust Company has pursued an investment discipline based on strategic asset allocation. This discipline is predicated on research showing that, over time, a portfolio’s variability of return is principally attributable to how portfolios are diversified across asset classes.

Describe how a client’s investment goals, risk preferences and spending policy are factored into your process.

We focus on long-term returns as the residuum of good risk control. Good risk control is primarily achieved through disciplined investment selection and decision-making, asset allocation rebalancing and portfolio construction processes.


Financial Planning

Why do I want you to do my financial planning?

Financial planning at Allen Trust Company is a collaborative effort. We start from the basics of getting to know you and your current financial situation. We then spend time talking through your answers to our detailed financial planning worksheet and learning from you what matters most for your future. Your goals are the driving force of your financial plan, we simply provide guidance and options to help you achieve your goals. And we follow up with you to be sure your plan continues to stay on target. In addition, we are fee-only financial planners, meaning we only charge a flat fee for our services and do not accept commissions of any kind.

What can financial planning help me with?

Financial planning can help you meet your financial goals and enjoy life’s milestones with a sense of security. For example:

  • Getting married
  • Buying your first (or vacation and/or income producing) home
  • Growing your family
  • Paying off debt
  • Sending your kids or grandchildren to college
  • Starting a business
  • Living your dream retirement
  • Protecting your family should something happen to you
  • Passing on your assets how you choose

Once you have a sense of what your goals are and the timeline you want to reach them by — whether that’s in the short or long term — a financial planner helps you assess what you need to do to get there. Sometimes you may not even be clear on what your goals should be; a financial planner can help with that, too. Next you look at what you earn, spend and save to evaluate what decisions and changes may be necessary to help ensure you stay on track. It’s all done with the help of a financial plan.

What is a financial plan?

A financial plan can be thought of as a roadmap. A financial plan looks inclusively at your finances and breaks down what you’d need to do in order to meet your goals, taking into consideration all your financial obligations. And when the unexpected happens, your financial plan can help you recover. A financial plan can include:

  • How much you should put toward your retirement nest egg
  • How much to maintain in an emergency fund
  • How much you should put toward big and small savings goals, whether it’s buying a new car, planning a family vacation or funding the retirement you always dreamed of
  • Advice on which savings and investment vehicles can help you reach your goals, and how to manage your portfolio according to your needs
  • The types of solutions that can help protect your family, your income and your assets, or help cover future needs like long-term care
  • How to pay down debt, such as your credit card balances or student loans
  • A budget that shows how your income can be used to cover your expenses and goal contributions — while making sure you can still have fun
  • An estate financial plan that will help ensure your wishes for your family and assets are carried out after your death

What is the difference between a financial planner and a financial advisor?

A financial planner creates a comprehensive financial plan for you to work from to meet your financial goals. Your financial plan may include any or all of the seven key areas financial planners are educated in: Investment planning, tax planning, insurance and risk management, education planning, estate planning, general principles of financial planning and professional ethics. They are considered a fiduciary and, as such, are directed to do what is in the best interests of their clients. Financial advisors are usually solely focused on creating investment strategy for their clients. Financial advisors are generally certified to sell investment products, usually for the benefit of the companies they work for.


Tax Preparation

Why do I want you to prepare my tax return?

We are here to save you time and money. A good CPA will give their clients confidence that their tax returns are filed correctly and that they don’t need to fear the IRS. Tax preparation is not just about documenting the past; it's about planning. We value each client relationship. We are committed to providing exceptional service for our clients. Our team of professionals works to provide the attention to details that matter to you. We are committed to excellence, and we pride ourselves on the training and education our team has. Whether it is trust tax preparation, tax planning for capital gains, or individual tax preparation, we are able to tap into our team’s investment, trust, and tax expertise to support your unique circumstances.

Do you incorporate tax planning and consulting as part of the daily work?

When making investment decisions like buying and selling stocks, we always consider how it will affect your tax situation. Integrating your investments, financial planning and tax services allows us to accurately assess the tax consequences of an investment decision without putting undue stress on you. We can track down the necessary documentation. When we know your tax situation, we can be proactive in optimizing your tax savings. Whether it has to do with capital loss harvesting*, retirement contributions, or estate or financial planning, we have the expertise here to not only advise you how to reduce your tax bill, but to help you make it happen.

Do you incorporate tax planning of marketable securities along with other assets?

We can help you make decisions throughout the year, not just at tax time. Considering buying or selling a house? We can determine how it will affect your taxes. Starting a new business? We can advise you on what forms will need to be filed, how to keep track of your income and expenses, and what records to retain. Interested in making a charitable donation? What vehicle should you use to maximize my charitable deduction? We can help.

What types of tax returns do you prepare?

We prepare the following federal tax returns and their corresponding state and local tax returns:

  • Form 1040 U.S. Individual Income Tax Return
  • Form 1041 U.S. Income Tax Return for Estates and Trusts
  • Form 1065 U.S. Return of Partnership Income
  • Form 1120 U.S. Corporation Income Tax Return
  • Form 1120S U.S. Income Tax Return for an S Corporation
  • Form 709 U.S. Gift Tax Return

What is capital loss harvesting?

Capital loss harvesting, or tax-loss harvesting, is the process of realizing (eg selling a stock) a long-term capital loss in order to reduce taxable income for a certain year. On the other hand, tax-gain harvesting turns unrealized long-term capital gains into realized gains. Gain harvesting would typically only be done in a year where the taxpayer’s income is unusually low, especially if they are in the zero percent capital gains tax bracket. Realizing the gain allows the taxpayer to make a new investment with an increased cost basis, reducing future capital gains that would be taxed at a higher rate. If used correctly, both of these methods will improve the after-tax return of your taxable investments.